Thursday, August 30, 2012

The quickest and easiest way to incorporate a small business is using MyCorporation.com. There are many services like this, but I've friends who've used this one numerous times with no hitches whatsoever. They take care of all the paperwork and send it to you in a binder.

What you need to decide is what kind of corporation you want to set up. For a simple business, a Limited Liability Company is probably the best for a single owner. If you have partners, you may want to investigate a Limited Liability Partnership or an S-Corp. You probably want to shy away from a C-Corp strictly for taxation purposes unless you're planning something big like an IPO.

Here's a link to a comparison chart of the various incorporation entities ...

You should also read the book "Are You Ready To Incorporate?... Saving Time & Money Through Sound Business Tactics" to help you decide what to do about incorporating.

Book Description ....

The myth: Everyone knows that only big companies and rich people with lawyers incorporate!

The facts: The reality is that there are a variety of ways to incorporate which match whatever business or venture you are engaged in and incorporation is available to everyone who wants financial security and tax savings.

In this remarkable and comprehensive book, the Editors of Socrates provide everything you need to know about incorporation in a single volume dedicated to clarity, easy access to information, helpful hints, practical interview with experts and design principles to make information gathering simple and enjoyable. No other contemporary book contains so much – including the invaluable free CD provided with each book in which glossaries of terms, forms, checklists, special reports, interviews, discussion and more are provided.

Monday, August 27, 2012

2. To add talent to build / translate your business plan to action. For this you need to share your vision with energetic team members who can join you in attaining the objectives.

3. For self. You need to translate your thoughts to paper so that you are able to do a milestone check on the journey at various stages.

To get started you'll need to work through the following steps ...

1. Talk with somebody who has written several successful business proposals. Ask what worked and what didn't.

2. Outline a two-part proposal. The first part will describe the business opportunity and your plans to take advantage of it. The second will present financial data - tax returns, a balance sheet and a summary of your operating plan.

3. Write the proposal. Limit the first part to 10 pages. Make it concise and clear. When describing the market opportunity, cite sources.

4. Explain what makes you and your company different from competitors. Perhaps you have special skills and experiences. You might have a new technology. Talk about your achievements in the industry.

5. Describe the segment of the market you will pursue. Discuss what you will do to take market share away from competitors.

Thursday, August 23, 2012

Worst and best start-up ideas depends on the location and environment where you'll be starting the business. In any business initiative program, it is best that you first consider the location and the market personality before jumping into conclusion whether a business or start-up idea is worst or not. For example, if the location is populated by health buffs and health conscious individuals, then no matter how many magazines or reviews point out that exercise and workout studios is a no- no, it might just work in that area.

The key here is to conduct a market research and evaluation to determine the best possible business idea that would work or succeed in that particular type of environment. Now, let's say that you have a business idea in mind (e.x. high-end restaurants), you need to find or locate the market niche where this business would really flourish and develop patrons and loyal customers.

Like what I've said earlier, there is no specific "best or worst" business idea. Others might say that "this is a good business" this year, but after some years it would just go bankrupt and all. It is best that you stick with a business that you like and love doing. After that, everything else would follow.

That said ... Kenneth Larson, a volunteer counselor with SCORE and Micro Mentor the last 6 years, considers these the worst and best startup ideas in his experience....

**On line administrative assistant ** Services to the elderly- transportation, errands etc ** Pet Care and Training Services ** Federal government contracting to tap stimulus funding coming through 123 federal agencies in almost every field of endeavor ** "GREEN " Environmental initiatives in almost every venue ** Maintenance, Repair and upkeep of foreclosed properties ** Non-profit organizations for community development chasing grants ** Self-Help Guides for Business ** Training on all aspects of small business Management ** On-line Books

Successful small businesses are developing enterprises in these fields through market research and business plans to deliver unique products and services - then pricing them and comparing them to the existing market, the competition and client demographics to determine feasibility before applying for financing and launching an enterprise.

Monday, August 20, 2012

Every business person should be a life long learner. keep recharging the tank and be open to learning new things. With that in mind here's a recommended list of books for entrepreneurs. It's by no means an all inclusive list so feel free to recommend your own by leaving a comment.

1)Technology Ventures: From Idea to Enterprise

2) The Startup Owner's Manual: The Step-By-Step Guide for Building a Great Company By Steve Blank, Bob Dorf

Thursday, August 16, 2012

We've been doing a few profiles of Venture Lab teams over the past few weeks. Our terrific research assistant, Hamsa has been putting these today and I think she's been doing a great job with it. It's inspirational to me to get to hear some of the in-depth stories of the entrepreneurs and startups that were touched at least in some small way by the course.Here's the story about Team Grayscale. I'm quite proud of them.The startup culture hit India about 2-3 years ago, Parth Saxena tellsus. Until then, even top MBA students would generally get hired byinternational companies, rather than start a venture on their own.Recently, an incredible change has occurred in the mindset of Indianyouth, and many seek to form their own companies. However,opportunities such as incubators are still scarce and buddingentrepreneurs are not aware of what measures to take. “What isrequired is a great network of mentors and venture-capitalists whichcan guide young startups to move on the right path,” says Parth. Thisis precisely the gap that Venture Lab seeks to bridge internationally.

The Grayscale team consists of two brothers, Parth and Dhruv Saxena,and their close friend Nikhil Kapur. Parth and Nikhil, both23-year-old fresh graduates, have been friends since their earlycollege days and yearned to start a company together. Their sharedpassion for music and Parth’s experience as a guitarist in local bandssparked the idea of TommyJams in early 2012. The duo noted thatdespite the rapid growth of the Indian live music industry, venuesstill sought event managers or personal connections to hire liveperformance artists, which both resulted in limited choice of artistsand higher prices for the venues. Furthermore, it limits opportunitiesfor new, budding artists who lack personal connections. TeamGrayscale’s idea of TommyJams would provide an online platform tobring together artists, venues, fans, and advertisers. Venues cansimply publish upcoming events and interested artists can submit aportfolio to be considered for the gig. Moreover, for perhaps thefirst time, the website will provide fans an opportunity to followtheir favorite artists and venues. With this dream in mind, the teamjoined Venture Lab.

Having worked on involved programming projects at multiple internshipsand competitions, the team had no lack of technical expertise. Parthhad extensive experience with databases and server-side interactionsand began working on the backend; Nikhil’s experience concerneduser-driven software, and he took over the front-end and the userinterface. Dhruv, who still attends college, was an idealpoint-of-contact for campus networking, and helped Parth with thebackend in his spare time. However, the team lacked entrepreneurialknowledge and an appropriate plan of action for understanding thecustomer segment. Working through Venture Lab’s course videos andassignments, the team performed extensive market analysis and manycustomer interviews. The feedback they gathered brought many useful,fundamental changes to their proposed product, says Parth , describingtheir key lesson as ‘Do not assume, go out and look!’ Moreover, theteam joined hands with four experienced mentors from Venture Lab’sextensive network and received advice through regular Skype calls.

Over the past few months, the team has been working long hours to puttogether a fully-functional prototype, and they are getting ready tolaunch a beta version. In preparation, Parth and Nikhil are quittingtheir full-time jobs at Texas Instruments and Microsoft respectively.“We need every spare moment after the launch to market the product andmake it truly viral,” says Parth. “Venture Lab was one of the bestthings that could have happened for our venture. Not only did we learnso much, but it has given us so much confidence that we are chuckingour jobs to become full-time entrepreneurs!”

What follows EVERY new entrepreneur should take to heart and embrace before going so far down the road with their business that's there's no turning backl. Heck ... even old timres who may be struggling should soak up these insights. In fact anyone who considers themselves an "Entrepreneur" will benefit.

The biggest mistakes ...

1) You assume you know what folks want 2) You try to sell & you are not good at it or you hate it. 3) You fail to define/understand that being an expert doesn't assure connecting with & acquiring paying customers.

These missteps are preventable. You can, with a few easy steps & ways of thinking get your messaging right so it does connect with & gain customers.

Try these steps for doing that....

1.People do things for their reason's not yours

If you have not done the in depth homework to see how a target audience thinks, what it cares about, & how to link what you want to what they want so they say "Hey, thats me - lets talk" ... you probably will be disappointed in your results.

2. Its hard to hear folks with a background in messaging and connecting for getting results trying to tell you that. That's because your belief in your direction is so strong in you that you think everyone will agree & want to join in. You get blinded by that belief & it prevents you from being objective about how best to get followers & customers.

Even hearing the communication "experts" saying things like "folks just do not care about that" referring to your pet project, being so caught up in the value of your idea, you resist their expert advice. Its just too hard on you & your deep seeded beliefs, values to accept what they say.

3. You just can not wish things into reality. If the audience has or sees no real buy in reason that, to them, resonates and says "that's me - that's exactly what I need to do and I am doing it" ... your message & recruiting efforts will fail.

There's just too many "you need to do this" messages bombarding us so its critical that you do what is suggested in this step in the way you reach out to folks.

4. Looking at ourselves, our core traits and what we are really good at, we should see what we are good at & not good at and accept it. If we are not marketing types & we want our idea to connect, get the marketing type to figure out how to do that.

5. Its not ego, its pragmatism that should govern how you & your strengths and weaknesses are played out in trying to make something happen. "Why go it alone when you don't have to?" Why risk failure trying to do what you know you are not good at, especially something as important as gaining willing customers?.

This is especially true when you want to influence people, their thoughts, manage your messaging so you do gain traction for your idea or project amongst the many different types of audiences out there.

Knowing precisely how to do this with differing approaches that resonate with differing target audiences is how you get to "yes, that's exactly what I need and I want to do it" from the members of the target audiences you have identified as folks who could benefit from what you offer. If you are not good at that, be brutally honest & let someone who is great at that help you by doing that part for you.

Failure is a learning experience but you can, especially if you want to create active acceptance/participation in something, avoid failure if you can adopt the thinking of what's been suggested here in this post.

And remember this very simple but useful way of thinking as you try to go gain joiners, genuine prospects, customers...

1. "People do things for their reason's not yours"

2. "Imagine the prospect or target audience has a sign on their forehead that says so what!"

Living those two axioms when charting connecting, influencing, getting supporters, getting customers goes a long way to realizing success for gaining acceptance of your idea. It goes a long way for you in getting folks to participate and willingly join in with your "vision" &, for their reasons, not yours, make it theirs as well.

So much is made of the founder having previous success, but how much more successful are those companies? Is there a hard number that quantifies the advantage - are they 5%, 15%, or 50% more successful? Really looking for the delta between the success rate of tech start-ups overall and the rate of success rate tech start-ups founded by serial tech entrepreneurs.

It depends in part on what you mean by "successful" and what on the relationship between the prior experience and the current startup.

Gompers and coauthors have a great paper addressing this and they find the following:

"In this paper, we address two basic questions: Is there performance persistence in entrepreneurship? And, if so, why? Our answer to the first question is yes: all else equal, a venture-capital-backed entrepreneur who succeeds in a venture (by our definition, starts a company that goes public) has a 30% chance of succeeding in his next venture. By contrast, first-time entrepreneurs have only a 21% chance of succeeding and entrepreneurs who previously failed have a 22% chance of succeeding."

Their paper is worth a read as they have some very clever measures of market-timing skill and managerial skill to answer their second question. However, their definition of success is based only on IPOs and prior experience is only VC-backed firms, creating some success bias in their estimates. Note that a 1 in 5 chance of having an IPO is still quite remarkable.

In a recent paper I look at a similar question, using a broader dataset of all founding attempts by MIT alumni. Instead of IPOs which are a goal of only a subset of entrepreneurs, I look at revenues as the success or performance measure. What my coauthor and I find is that the advantage of prior experience depends on how similar the current venture is to the previous one. The more dissimilar, in terms of industry or technology, the less experience helps and the more important innate talent is for performance. The empirical challenge here is that more talented entrepreneurs may be more likely to go on and found more companies, so we needed some sophisticated statistics to disentangle the impact of experience vs. innate entrepreneurial talent.

Overall, revenues are 52% higher for the experienced entrepreneur and 113% higher for the experienced entrepreneur starting a firm in the same industry. Mean revenues in this sample are $328,000. So for the experienced founder, mean revenues would be $498,000. However, if the experienced founder starts a company in an unfamiliar setting then experience becomes a liability. With a very innovative technology revenues are actually 6.8% lower. If your prior experience was before the dotcom internet disruption then for the next firm your revenues are likely to be 43.8% lower. So whether experience helps or hurts very much depends on the context and how similar the current venture and industry environment is to the previous experience.

I include the citation, abstract and a bit of the text of the paper below to give more of an example of the theoretical arguments and reasons why this may be the case.

Abstract: We explore whether entrepreneurial performance is due to innate talent or the accumulation of entrepreneurial experience. Using a novel data set with multiple observations of founding attempts per individual, we generate a unique measure of entrepreneurial talent. In contrast to prior findings, the relative importance of experience versus talent changes with the context.When the current market or technology is familiar, experience dominates. However, when the venture context is unfamiliar, talent is more important. Individuals with experience and talent handle both familiar and unfamiliar aspects and may extract more from a given level of experience. The findings advance our understanding of how the drivers of venture performance shift with the broader technological and industry environment and places limits on when experience aids performance.

Overall, this ‘learning by doing’ enables experienced entrepreneurs to imprint their ventures more effectively at the outset by choosing better opportunities (Huber, 1991; Ingram and Baum, 1997; Baum and Ingram, 1998). As time goes on, they are better able to develop viable business models, raise funding, install superior strategic processes, and complete the tasks involved in setting up a new firm. Prior experience in this case allows the entrepreneur to reuse strategies, network connections, and industry-specific knowledge. With more prior founding experience, the entrepreneur has seen a wider spectrum of issues and problems during the start-up process. The greater the number of prior start-up experiences he/she has to draw from, the less likely that the decisions that need to be made in the next venture will be unexpected or unknown to the entrepreneur. While an inexperienced entrepreneur may spend valuable time and money discussing and trying out different solutions to problems that arise, the experienced entrepreneur has likely already encountered these problems and has solutions. Specifically, we propose:

Hypothesis 1a: An entrepreneur with more venture founding experience is more likely to found a high-performing venture.We also expect that venture experience will be particularly advantageous for focal venture performance when the entrepreneur is familiar with critical aspects of that venture. That is, when the context surrounding the new venture is more familiar to the entrepreneur and, thus, more similar to the past, learning from prior entrepreneurial experience will be of particular relevance (Argote and Ingram, 2000; Argote, Beckman, and Epple, 1990). Lessons from the past will more directly transfer to the current situation. We define familiarity as having a close acquaintance or being well known. For example, when entrepreneurs engage with familiar technologies, they are likely to face fewer surprises and less likelihood to encounter problems. There have been opportunities to work out bugs, increase predictability, and better understand customer needs related to the technology (Levinthal and March, 1993; Meyer and Roberts, 1986). Similarly, when an entrepreneur starts a firm in a familiar industry, he/she is likely to understand the competitive dynamics of the industry. He/she will already be familiar with customers, suppliers, and ways of doing business in the industry. He/she may be able to use analogies from prior experience that fit particularly well with the current venture (Gavetti, Levinthal, and Rivkin, 2005), and he/she can reuse existing relationships. When problems arise, in a more familiar context, there is a greater likelihood that they have an overlap with problems that the entrepreneur has already faced in a previous venture.Even when choosing which entrepreneurial opportunity to pursue, if entrepreneurs stick to an industry or technology they are familiar with, they are more likely to identify a valuable opportunity. When the entrepreneur knows the market, customer preferences, and potential distribution or channel partners, he/she is more likely to choose a promising opportunity. In contrast, if the experienced entrepreneur strays into potential opportunities in an unknown area, it is more likely that unexpected challenges will arise or that the product will not be exactly what consumers want or a critical sales strategy or aspect of the business model will not work in the end. The experienced entrepreneur in a familiar domain has experience with a greater number of the constraints that must be satisfied for an idea to be a good business opportunity.Finally, and in contrast with the benefits gained from experiences, experienced entrepreneurs may gain hubris and overconfidence along with experience (Hiller and Hambrick, 2005), making them particularly ineffective in unfamiliar contexts. For example, they may underestimate the uncertainty associated with a less familiar technology. Entrepreneurs will be less likely to benefit from their prior venture experience if their focal industry has undergone a major disruption. When the industry is disrupted, experienced entrepreneurs no longer have an understanding of industry dynamics and their experience is not likely to give them an advantage. It is then less likely that problems they encounter will be ones with which they are familiar and have a known solution from experience. Overall, we argue that entrepreneurial experience will be particularly likely to aid venture performance when the focal venture is in a context that is familiar to the entrepreneur. Both in opportunity selection and in execution, the more an experienced entrepreneur remains in a familiar context, the fewer surprises that will be encountered and the higher the likely performance of the venture.

Hypothesis 1b: The positive effect predicted in H1a will be stronger for ventures started under more familiar conditions.

Talent is a second, yet less explored, explanation for the positive link between serial entrepreneurs and performance. Here we argue that a significant source of success in starting ventures is time-invariant entrepreneurial talent differences across individuals. Schumpeter (1934) was the first in the literature to suggest that entrepreneurs have skill or talent, rather than simply being bearers of risk. Since then, relatively little scholarly work has examined entrepreneurial talent. Lucas (1978) refers to managerial talent in firm formation and defines it as an ability to get more output per worker. Others similarly have defined talent as the ability to get greater entrepreneurial earnings out of a given amount of capital invested (Evans and Jovanovic, 1989). Amit, Glosten, and Muller (1990: p. 1233) define entrepreneurial talent as ‘the ability to combine tangible and intangible assets and to deploy them to meet customer needs in a manner that cannot easily be imitated.’ Others have defined talent as having a market timing and managerial component (Gompers et al., 2010). We attempt to synthesize and simplify these definitions. By entrepreneurial talent, we mean superior ability to consistently see viable entrepreneurial opportunities and effectively act upon them to generate greater venture performance.

Given their superior ability, talented entrepreneurs are more likely to succeed in their initial ventures, and these successes are then likely to motivate them to found successive firms (Gompers et al., 2010). As a result, serial entrepreneurs may form a more talented pool of individuals than the pool of all entrepreneurs. Less talented first-time entrepreneurs may fail in their initial ventures and decide not to found a subsequent firm. Alternatively, they may face difficulty in recruiting new cofounders or raising capital. This may lead to the well-known relationship between serial entrepreneurs and venture performance.Innate entrepreneurial talent involves more abstract reasoning, divergent thinking, synthesizing disparate ideas, and frame-breaking behaviors. These talents allow them to identify higher quality entrepreneurial opportunities since this task requires more than simply applying prior, historical experience. Every potentially valuable entrepreneurial opportunity has some aspects that are unique or unexpected. Where merely experienced entrepreneurs might mistakenly apply prior lessons, talented entrepreneurs can more naturally think through the more novel, less familiar aspects of the venture. A new opportunity may require a business model that has not been tried before or a distribution channel that needs to be created from scratch. If the opportunity requires that new markets are created or new sales and marketing strategies be generated, then the talented entrepreneur has an advantage in being able to think more flexibly rather than reflexively applying an old strategy from a prior venture.Appropriate strategic actions may be ambiguous and unpredictable or experience may not apply when an entrepreneurial opportunity is very new, highly risky, and unfamiliar. Precisely in these conditions, experience may not apply and talented entrepreneurs will excel. Overall, these arguments lead us to propose:

Hypothesis 2a: An entrepreneur with more innate talent is more likely to found a high-performing venture.Entrepreneurial talent will be less advantageous when entrepreneurs encounter more familiar conditions. Talent is less of an advantage when the entrepreneur has already experienced this set of conditions and is already familiar with the appropriate strategic decisions and responses. In familiar conditions, the talented entrepreneur does not need to sort out new frameworks or work out the best commercialization choices to make. Talent is less relevant, when familiar contexts allow the selection and reuse of prior experience. In a familiar context, if decisions or problems arise that the entrepreneur has seen and solved previously, then talent is less useful because the problem is not one of generating new solutions but simply applying prior experience. The talented but inexperienced entrepreneur might waste valuable time thinking up possible commercialization choices and reinventing the wheel, while an experienced entrepreneur already knows the solution and can more quickly make decisions and move forward.

Correspondingly, we also expect that entrepreneurial talent will be particularly advantageous when entrepreneurs face less familiar conditions (e.g., different industry, disrupted industry, and novel technology). In these contexts, entrepreneurs must sort out appropriate strategic actions when many factors—such as market opportunities, business models, customers, and marketing channels—are ambiguous and unpredictable. Entrepreneurs with innate talent may find it easier to apply their talent toward thinking through these novel situations in which experience may simply not apply. Similar to an individual with mathematical talent who can derive an appropriate formula from first principles, talented entrepreneurs can rely less on memorized routines learned from past experience. Instead, they are more able to figure out correct strategic actions from reasoning through the appropriate choices in a new situation. They are capable of more abstract reasoning and synthesizing information. In addition, talented entrepreneurs may be more confident of their abilities when faced with unpredictability. Finally, they are more likely to engage in frame-breaking activities—such as experimentation, questioning, and observation—that are associated with divergent thinking (Dyer, Gregersen, and Christensen, 2008). Such thinking enables entrepreneurs to spot viable opportunities sooner and provide novel insights for executing them in less familiar contexts. The ability to handle the unfamiliar and unexpected results in more consistently high performance since the unfamiliar and unexpected are aspects that introduce inconsistency into performance.

Tuesday, August 14, 2012

He was one of America’s founding fathers, and the dude sure was pithy with his business advice. So here we have some bits of his wisdom, passed down from his Poor Richard’s Almanacs and showing you how they can help you grow your business.

If you’ve ever been to a webinars, you’ve seen how useful they can be when it comes to delivering content to an audience. The word “webinar” is an amalgamation of the words “web” and “seminar” — basically a presentation you give to an audience over the web.

With clear instructions and educational webinars, people are more likely to sign up for your information, buy your product and/or stay with your business.

Read more about how you can use webinars to advance your business interests here ....

Monday, August 13, 2012

If someone has never directly sold, then I would definitely suggest they get sales training or coaching.

- You need to know who exactly your target market is.

- How are you going to get access to them? (List, phone book,....etc)

- How are you going to organize your day? How many calls will you make, how will you track your calls, what will you do for follow-up.

- How comfortable are you on the phone? Do you have a script?

-How comfortable are you in presenting your products and services, do you know how to go for the close?

-How do you track and manage your prospects? What kind of reporting do you do (pipeline, forecast,...etc)

-Do you know the sales cycle for products / services you are selling?

These are just the basics and usually someone who has NEVER sold does not know where to start, so I would advise even if they feel comfortable to enroll in a sales training course to get the basics or get coaching. Coaching will help as it will give the person someone to work with along the way and gain feedback.

It is a big mistake "to try to figure it out" as you go. People who do usually get behind the 8 ball. They can't organize themselves, have a quota to hit and are not focused properly. Everyone needs some help at new things.

Thursday, August 9, 2012

Adjust your mindset to accept creativity where you find it. A lot of people assume certain activities are creative and some aren't, challenge yourself to find a creative aspect to every position.

For example, typically you might think artist, writer, and musician are the main creative fields. But the guys on American Choppers are just as creative with motorcycle mechanics. Even lumber-jacks have those log chain saw carvings...

In their own way lots of careers have a creative/ artistic niche - seek them out. Don't feel pigeon holed into arts and crafts as the only options. Spend more time doing creative activities you enjoy, that leave you feeling energized and satisfied.

I really enjoy cooking, its fun for me. Gardening not so much, but other people LOVE the garden center as much as I love my Williams Sonoma store. For me it helped to realize I don't have to love the same creative pursuits that my friends and family love - especially if their hobby feels like chore to me.

Creative problem solving is useful on every job. Brainstorm on your own without editing yourself, then once you have all your ideas out on paper you have lots to pick from.

Fun exercise, set a timer for 1 minute and write down all the uses for a bucket.

Also, we often ignore the direct impact our physical health and mind/body balance have on our creativity.

The human physiology has not evolved to match the pace at which we live today and the technology available to us. Gadgets (or "Gadget" programs) for fitness are a fad, cost money and supply relatively little value. They espouse the quick and easy because that is what sells. Diet programs are the same.

The following 4 basics are suggested for starters. They can be efficiently achieved but not quickly and for many not easily. But they are monumentally worth the investment. Like many other challenges they require management and synchrony with the other elements of our life.

1. Realign a long walk with problem solving and family time to have a clear horizon and put mind and body in synchrony. Our bodies still require moderate exercise to function because we have not yet evolved out of your "Hunter/Gatherer/Fight/Flight" physiology.

2. Develop habits that permit the subliminal mind to work while the body rests as least 7 hours a day with sleep.

3. The human body needs a mix of lean meat and vegetables. The artificial junk clogs us up and wears us down.

4. Manage expectations - those others have for us and those we have for ourselves. We are sensitive and vulnerable creatures, designed in a complex and vastly varying ways. The pace of life these days requires cultivation of expectation management and everyone must evolve their own unique form of that art.

Tuesday, August 7, 2012

I've been really thrilled with what happened with our experiment in the online Technology Entrepreneurship "course" and in creating this learning community of tens of thousands of entrepreneurs worldwide working on startup projects and learning from one another. So many of you have written to me that you found cofounders through the site and are diving in, building your companies. It really gives me a warm feeling and I know Amin and Farnaz are really excited as well! Of course everything didn't go perfectly, but that gives us a great roadmap of improvements for the next time around.Stanford University Pres. Hennessy is mentioning the class in an article that he's working on so we pulled together some of the numbers. The total number of students was 82,303. The number of students who chose to do a start-up project was 37,606. The number of countries represented is over 150. We had over 200 mentors (I'm also hoping that many of you will sign up to mentor the new students the next time around).

Our student body was very diverse. The percentage of women in the class was 17% which is above the norm in Silicon valley (8%). We had students who were Stanford alumni or experienced entrepreneurs in Silicon Valley; we had women from Iran leading a team of entrepreneurs; we had a group of students from Nairobi and from Ghana who would travel to an Internet cafe to access class materials.For the OEP, the biggest lessons were the following:1.) Once again, a great set of teammates who are engaged and nearby makes all the difference. It's so much easier to stay motivated and make rapid progress when you can see your teammates really pulling their weight and getting a lot done as well. It just makes you want to work harder and makes it more fun. Entrepreneurship is truly a team sport.2.) Getting out of your head and out into the real world to show and talk about your startup with others makes it much more real and allows you to see what is working and what isn't with your business model. It's easy to say that you will partner with such and such company for distribution, but when you have to get a meeting with them and really discuss what such a partnership would require, you really learn a lot more. Or with marketing, it's easy to say, we will use social media and blogs to get the word out. But when you have to actually start that social media campaign and keep track of how much time you spent and how many people actually came to your site and left their email, you see that it's not so easy.3.) A prototype in some form really helps a lot. When you can really put a version of your product or service in front of customers and they can see it and use it, then you get much more useful feedback compared with when it was just an idea that you were telling them about.4.) Negative feedback on some part of your business model is not the end of the world. Entrepreneurship is a roller coaster of emotional ups and downs. Negative feedback is just getting you one step closer to figuring out a model that will work. Work experience in the industry helps, but at the end of the day you've just got to take the first step and get out there and start iterating and learning from the market what aspects of the business model need to be modified.5.) Choosing the right revenue model is not always straightforward. It is difficult to really show with real data that the business will make money. Until you're out there with a website or product and making some sales, it's not easy to guess ahead of time what the costs will really look like for customer acquisition or how much revenue you can expect from subscriptions or advertising. Relatively few teams made it to this stage where they could really compare revenue per user data against costs of acquiring that customer to see if the business model would truly scale.6.) It is not easy to be concise with the OEP presentation. There is a lot of information to convey about your project and the team and getting just the write amount of key information out there in a short amount of time takes some practice.

7.) Having a mentor is a tremendous help. I noticed that a lot of teams spoke very highly of the feedback and help that they got from their mentors. Many mentors seemed to enjoy the process as well. Some of them ended up mentoring more teams than they initially thought they would!Lessons from Students:

This is an interview of John Hennessy (the 10th President of Stanford University and one of the founders of MIPS Computer Systems) by Amin Saberi and part of Stanford online class on technology entrepreneurship. For more information see http://venture-lab.org

Monday, August 6, 2012

As a small business owner attending networking events should be part of your normal routine. Developing relationships with other business people can lead to partnering, mentoring, clients, and friendships. All of which can benefit your business as well as you pwersonally.

Keep these simple tips in mind when you participate in a networking event ....

Do not talk about only yourself Do not push your services or products Make sure to practice your elevator pitch Be polite Smile Be professionally dressed

My biggest pet peeve is that so many people don't understand that networking is not selling!

Networking is about meeting people, exploring possibilities, perhaps getting to know people and their needs better. Yet so many are there only to sell, sell, sell. They could care less who you are or what your needs/interests are. They just want to push their products/services at you.

So some more tips are ... be friendly & welcoming, ask more questions, talk about the other person more than yourself, if a sales pitch starts up, excuse yourself politely and move on.

Another pet peeve isn't necessarily what happens at networking events, but rather an outgrowth of it.

I usually end up with a fair amount of business cards, but despite my efforts to connect with these people after the event... many are non-responsive. I am left wondering why people went to an event if they had no intention of trying to establish new relationships.

It may be that some people are really only interested in what they can sell you or what you can do for THEM. So if they determine you aren't useful, they don't bother trying to get to know you.

Me, I enjoy meeting people. If I'm able to help them then I'm happy to do it; but I expect them to be engaged at the least. I go to networking events to network... not to have my time wasted by people who don't really care.

Modern networking is a marathon, not a sprint. It is about creating and building relationships with the people you meet.

I believe there isn't anything that can replace the benefits of in-person networking, and that is saying a lot because I am introverted and would rather stay behind my computer!

Where you network is as important as how you network; BNI is a more structured and results-oriented networking group ... whereas Chambers of Commerce are informal and more about what your business brings to the community (money, jobs).

Whatever you do RELAX and be yourself. Don't fake it. Meet a new friend and grow an old friend.

Thursday, August 2, 2012

A marketing plan is part of your overall business plan ... and very important part. With that in mind you should spend special attention to building your marketing plan as it may make the difference between success and failure.

Here's what you need to consoider to build a marketing plan that will set your small business off in the right direction.

TASTE, TRENDS AND TECHNOLOGY

What does your research indicate is the trend in your field? Will it stay the way you are currently offering supplies and services or will it change? This item covers the developments you expect for the next few years. Evan a 'perfect' business can become obsolete overnight due to future developments. Specify a 5 year forecast of your field in your area.

SALES REVENUE FORECAST

Have you developed these targets? This section shows your estimates of future sales revenue for your business. Your strategic plan, needs to spell out the specific actions you will take to achieve your forecast sales revenues.

DIFFERENTIATE YOUR BUSINESS FROM THE COMPETITION

How does your business differ from the competition's strong and weak points. Again, remember to carefully look at your business from the customer's perspective. If you're not sure how your pricing policies compare to the competition, here are some guidelines. Most people associate high prices with high quality and extra service, while they associate low prices with low or average quality and minimum service. Make sure you provide extra quality and service if your prices are higher than your competition or make sure that your prices are lower if your quality is average and your service is minimum.

DECIDE HOW TO REACH CUSTOMERS

Once you describe your target customer, it's easier to create a list of possible ways to reach that person. One of your jobs as a businessperson is to decide which of all the possible methods of communication will give you the most exposure for the least cost in money or time.

EVALUATE THE RISKS FACING YOUR BUSINESS

COMPETITION: Most businesses have competition. How will your business differ in significant and positive ways from your competition? If your competition is strong, don't minimize that fact, but figure out ways you will adjust to or use that strength. For example, if you plan to open a restaurant next to an extremely popular one, part of your strategy might be to cater to the overflow. Another might be to open on days or evenings when the other restaurant is closed.

PIONEERING: If you anticipate no direct competition, your business probably involves selling a new product or service, or one that is new to your area. How will you avoid going broke trying to develop a market?

CYCLES AND TRENDS: Many businesses have cycles of growth and decline often based on outside factors such as taste, trends or technology. What is your forecast of the cycles and trends in your business? For example, if your forecast tells you that the new electronic product you plan to manufacture may decline in three years when the market is saturated, can you earn enough money in the meantime to make the venture worthwhile?

SLOW TIMES: Every business experiences ups and downs. Is your business small and simple enough, or capitalized adequately enough, to ride out slow times? Or do you have some other strategy, such as staying open long hours in the busy season and closing during times of the year when business is ?

OWNERS EXPERTISE: Nobody knows everything. How do you plan to compensate for the knowledge you're short on?

Write your risk analysis by first thinking of the main dangers your business faces. This shouldn't be hard, as you have probably been concerned about them for some time. Some of these may be on the list set out above; others will be unique to your business. Once you have identified the principal risks facing your business, write out a plan to counter each. But don't bog yourself down worrying about all sorts of unlikely disasters.